Abstract

The contribution of knowledge transfer to an organization's overall performance outcomes has become one of the central themes of investigation among the theorists and scholars in the field of knowledge management. This paper questions the positive effect of external knowledge transfer on an organization's financial performance, taking into account that even coordinated knowledge transfer is time consuming and likely to impair the performance outcomes when the conditions appropriate for obviating the inherent difficulty of knowledge transfer are not established. Its aim is to examine the fundamental role of the attractiveness of industry as a main moderator in an external knowledge‑transfer activity which takes place between two parties in an alliance. Consistent with prior work on knowledge management this study argues that transfer costs are determinative factors for an organization's performance and include: (i) the considerable amount of time spent searching in order to identify the appropriate new knowledge required, (ii) the effort to effectively distribute this knowledge between the parties of an alliance and (iii) the time needed for the external knowledge to be implemented effectively to an organization's daily processes. The case to be examined is that of organizations which are in great need of obtaining and using new knowledge to achieve business model innovation. This kind of organizations is more likely to be affected by search and transfer costs since they are trying to reduce time‑to‑ market entry, thus, achieving first mover advantage. A plausible source of knowledge for these organizations (knowledge seekers) is the formation of strategic alliances with organizations which not only possess the required knowledge (knowledge keepers) but also operate in attractive environments. An attractive environment, among others, is liable to frequent entries of new players and this may not give time to such organizations to elaborate and effectively utilize the knowledge that is externally derived. These assumptions are shaped on an overarching conceptual framework, which identifies the role of the attractiveness of the industry and delineates research propositions, taking the Mobile Virtual Network Operators (MVNOs) as a case study. To determine the attractiveness of the mobile telecom industry we apply Porter's five forces framework and then we draw on a number of interviews which allows us to provide data suggesting that with an increase in the number of new entrants in the mobile telecom industry, an increase in the amount of knowledge derived externally may reduce the organization's ability to increase its performance outcomes.